White Paper

In the context of the digital age, blockchain technology is gradually becoming the key driver of innovation in industries such as finance, supply chain, and the Internet of Things (IoT). K Chain, as a pioneer in this wave, is dedicated to building a high-performance public blockchain platform, focusing on realizing the vision of a decentralized social ecosystem. By adopting the POSAP consensus mechanism, K Chain not only enhances the security and efficiency of the network but also provides users and developers with a secure, efficient, and open platform through technological innovations such as cross-chain transactions and decentralized order-book trading.

K Chain is clearly positioned to become the core infrastructure of the next-generation decentralized social economy. By supporting the development of smart contracts and (Decentralized Applications) DApps, it provides more secure data storage and fairer value distribution for social networks, while ensuring users’ freedom of speech and privacy. K Chain’s cross-chain capabilities break down the barriers between blockchain networks, promoting the free flow of assets and data, and providing a secure environment for digital asset exchanges within social networks.

With the global proliferation of social networks and the rise of concepts such as (Decentralized Finance) DeFi and (Non-Fungible Tokens) NFTs, K Chain is gaining a broader application prospects. It will support diverse social application scenarios, including decentralized content platforms, social payment systems, and social games, attracting more users and developers to join its ecosystem. K Chain adheres to a community-driven governance model, ensuring that the platform’s development direction aligns with the collective interests of the community through decentralized proposals and voting systems.

In the future, K Chain will continue to focus on the sustainable development of its ecosystem, promoting environmentally friendly and energy-efficient consensus mechanisms, reducing energy consumption, while optimizing the underlying architecture and consensus mechanism to enhance network performance and security. As blockchain technology continues to mature, K Chain is poised to become an important platform for global user social interaction, offering users unprecedented freedom and participation. Through continuous technological innovation and community building, K Chain will usher in the new era of social interaction, where everyone can find their place in the digital world.

1.1 Market Background

In today’s digital era, blockchain technology, with its unique decentralized characteristics and security, has become a key force driving innovation across various industries, including finance, supply chain, and the Internet of Things (IoT). In particular, public blockchain technology, as the cornerstone of the blockchain ecosystem, has garnered widespread attention regarding its current status and future potential.

Public blockchains, with their openness and transparency, provide developers with a platform to build decentralized applications (DApps) without seeking permission. With the rise of early public blockchains platforms like Ethereum, we have witnessed the rapid development of smart contracts and token economies. These technologies have not only driven the popularization of cryptocurrencies but also provided fertile ground for exploring new business models. However, as the number of users and transaction volumes increase, the scalability and high transaction cost issues faced by existing public blockchains have become more prominent, prompting communities and developers to seek more efficient but low-cost solutions.

Currently, the blockchain market is evolving towards the direction of higher transaction, lower latency, and more optimized energy efficiency. For instance, according to a report by Dapp.com, although Ethereum remains the main platform for DApps, other emerging public blockchains such as Binance Smart Chain and Polkadot are rapidly rising. They are attracting a large number of users and developers by offering faster transaction speeds and lower fees.

Moreover, with the rise of concepts such as DeFi (Decentralized Finance) and NFTs (Non-Fungible Tokens), the application scenarios for public blockchain technology have greatly expanded. DeFi projects use smart contracts to offer financial services such as lending, trading, and insurance, while NFTs provide unique identification and ownership certificates for digital artworks and collectibles. According to Chainalysis, the NFT market reached a scale of $24.9 billion in 2021, demonstrating the significant potential of public blockchain technology in the digital asset space.

In the future, the development of public blockchain technology will increasingly focus on cross-chain interoperability, privacy protection, and scalability. With the rise of multi-chain ecosystems, cross-chain technology will become the bridge connecting different blockchain networks, enabling seamless asset and data flow. Additionally, as users become more conscious of privacy protection, public blockchains will integrate more privacy technologies, such as zero-knowledge proofs, to safeguard the anonymity of user transactions. Furthermore, as technology advances, such as through sharding and state channels, the scalability of public blockchains will be significantly enhanced, meeting the demands of larger-scale commercial applications.

Public blockchain technology is currently in the phase of rapid development. It not only offers new possibilities for existing financial and commercial activities but also opens up vast opportunities for future technological innovation and applications. As the technology continues to mature and the market becomes increasingly educated, public blockchains will undoubtedly become the key force driving the digital economy and the development of the next-generation internet.

1.2 Integration of Social Ecosystems and Blockchain

The integration of social ecosystems and blockchain technology is ushering in a new era of communication and value exchange. As social networks become globally pervasive, there is a growing demand for safer, more transparent, and more personalized social experiences. Blockchain technology, with its decentralized, immutable, and cryptographically secure features, offers a new way to build social networks. This approach not only enhances users’ control over their data but also creates a fairer value distribution mechanism.

According to Statista, globally, the number of social media users is expected to reach 3.6 billion by 2024, accounting for nearly 45% of the world’s population. This vast user base provides a broad market space for social blockchain applications. By introducing token economy models, social blockchain applications can incentivize users to create content, participate in community governance, and even earn rewards through social interactions, thereby stimulating community vitality and creativity.

In the social ecosystem, the applications of blockchain technology are mainly reflected in the following aspects:

1. Enhanced privacy and security of user data: With blockchain’s encryption technology, users’ personal information and communication records can be stored and transmitted more securely.
2. Digital identity and reputation systems in social networks can become more authentic and reliable, as blockchain-based identity verification and reputation scoring mechanisms provide users with a decentralized credit system.
   3. Blockchain technology will bring greater transparency and fairness to social media’s advertising and content monetization models. Users can decide whether to engage with advertisements based on their preferences and receive tokens as compensation.
3. Additionally, as 5G and IoT technologies advance, social networks will become even more embedded in everyday life, with blockchain technology supporting secure communication and data exchange between devices. For instance, smart home devices can securely synchronize and control data via a blockchain network, while users’ interactions on social networks can be connected with their smart devices, creating a more personalized smart living experience.

The development of social blockchain applications also encounters several challenges, including cultivating user habits, enhancing the ease of use of the technology, and integrating with existing social platforms. However, as the technology matures and the market becomes more educated, these challenges will gradually be overcome. In the future, social blockchain applications are anticipated to become a crucial link connecting people, people with devices, and devices with one another, driving the creation of a more open, interconnected, and intelligent social ecosystem.

1.3 Market Innovation and Ecosystem Development of K Chain

K Chain, with its advanced technological architecture and innovative features, is committed to filling the current gap in the blockchain market within the social ecosystem field. By integrating the POSAP mining mechanism, K Chain not only enhances the security and efficiency of the network but also incentivizes user participation in network governance. This optimization of the consensus mechanism enables K Chain to support large-scale social applications while maintaining low transaction costs and fast transaction confirmation times, addressing the performance bottlenecks faced by existing public blockchains when handling high-concurrency social activities.

The cross-chain transaction capability of K Chain breaks down the walls separating different blockchain networks, allowing assets and data to flow freely between them. This feature greatly expands K Chain’s application scope, enabling it to serve a broader user base, including those already using other public blockchain services. Additionally, K Chain’s support for third-party token issuance provides a convenient way for projects and enterprises to leverage blockchain technology for fundraising and community incentives, further enriching the economic model within the social ecosystem.

K Chain’s decentralized order-book trading feature offers users a trading venue independent of centralized exchanges, which not only lowers transaction costs but also enhances the security and transparency of transactions. This decentralized trading approach creates a secure environment for digital asset exchanges within social networks, thereby facilitating the flow of value within these networks.

K Chain places significant emphasis on implementing distributed storage solutions in the social ecosystem. This strategy not only guarantees the privacy and security of user data but also provides robust support for the storage of large datasets within social applications. Through Linksay, a decentralized messaging application, K Chain demonstrates its technology in real social scenarios, achieving both distributed storage of user data and freedom of speech, all while ensuring the security of assets.

Utilizing its technological advantages, K Chain delivers a secure, efficient, and decentralized platform. Through ongoing innovation and optimization, it meets the evolving demands of the social ecosystem in the blockchain domain, providing the market with fresh solutions and accelerating the advancement of social networks and the widespread use of blockchain technology.

2.1 Positioning of K Chain

K Chain’s positioning: To build a high-performance public blockchain for the next-generation decentralized social economy, integrating POSAP mining, cross-chain interoperability, and decentralized trading, with the aim of creating a secure, efficient, and open social ecosystem.

As a public blockchain that supports POSAP mining, K Chain not only introduces a new incentive mechanism for miners and token holders but also enhances network decentralization and community engagement through staking and delegator voting for validator elections. This mining approach reduces energy consumption while maintaining the network’s security and stability.

The cross-chain transaction capability of K Chain is another major showcase of its technological strength. By building high-efficiency cross-chain bridge technology, K Chain allows for seamless integration with other leading blockchain networks, enabling the free exchange of assets and information and providing users with expanded application scenarios and increased investment opportunities. Moreover, K Chain’s decentralized trading feature creates a trustless trading environment, reducing transaction costs and improving transparency and security.

K Chain’s positioning goes beyond technological innovation; it reflects a deep understanding and application within the social ecosystem. K Chain aims to leverage blockchain technology to bring more secure data storage, fairer value distribution, and more open communication environments to social networks, promoting the healthy development of the social ecosystem, and building an open, interconnected, and intelligent new social world. Through continuous technological innovation and application exploration, K Chain is gradually becoming a bridge between the real world and the digital world, providing global users with a new platform for value exchange and social interaction.

2.2 Core Values of K Chain

The core values of K Chain focus on delivering a secure, efficient, and decentralized platform to users and developers. This platform not only facilitates the deep integration of the social ecosystem with blockchain technology but also promotes innovation and development in social networks while ensuring users’ freedom of speech and privacy. The core values consist of:

1. Security: K Chain guarantees network security and the immutability of transactions through advanced encryption technology and an enhanced POSAP consensus mechanism, offering users a trustworthy blockchain environment.
2. Efficiency: Through the use of optimized network protocols and data structures, K Chain achieves high throughput and low-latency transaction processing, addressing the needs of high-frequency transactions in social networks.
3. Decentralization: By eliminating single points of failure and censorship risks that are found in centralized platforms, K Chain’s decentralized design ensures the openness of social networks and preserves user autonomy.
4. Social Ecosystem Integration: K Chain supports a wide variety of social application scenarios, including content creation, community engagement, and value exchange, driving the prosperity and innovation of the social ecosystem.
5. Freedom of Speech: On K Chain’s social platform, users can freely express opinions and share information without worrying about censorship or restrictions.
6. Privacy and Security: With features like anonymous transactions and encrypted data storage, K Chain delivers robust privacy protection, ensuring the safety of users’ personal information and communications.

Through the realization of these core values, K Chain aims to build a new social network environment that allows users to benefit from the convenience and advantages of blockchain technology while safeguarding their rights and freedoms.

3.1 Design Principles

The design of K Chain adheres to the following principles:

1. Independent Blockchain: K Chain is an independent blockchain infrastructure solution.
2. Ethereum Compatibility: As the first practical and widely adopted smart contract platform, Ethereum set the foundation for decentralized applications. To ensure compatibility with existing applications and communities, K Chain is designed to work seamlessly with the Ethereum mainnet. This means that most of the dApps, ecosystem components, and tools will run on K Chain without requiring changes or with only minimal tweaks, ensuring compatibility with future Ethereum updates as well.
3. Staking-Based Consensus and On-Chain Governance: The proof-of-stake (PoS) consensus mechanism is more environmentally sustainable and offers the community more flexible governance options.

3.2 Consensus and Validators

Following the above design principles, K Chain’s consensus protocol is designed to accomplish the following objectives:

• Keep the block time at 3 seconds.
• Ensure transaction finality within a short period, approximately around 1 minute or less.
• Generate blockchain revenue from block rewards and transaction fees, paid in K Coin.
• Maximize compatibility with Ethereum.
• Implement staking-based, on-chain governance mechanisms.

3.2.1 Proof of Staked Authority Plus+ (PoSAP)

Though Proof-of-Work (PoW) has been proven as a viable solution for decentralized networks, it poses environmental concerns and requires a large number of participants to maintain security. Proof-of-Authority (PoA) protocols have been criticized for being less decentralized than PoW, as validators—nodes responsible for generating blocks—hold substantial power, making them vulnerable to corruption and security breaches. Blockchains like EOS have adopted Delegated Proof of Stake (DPoS), where token holders can vote to elect validator nodes, leading to greater decentralization and improved community governance.

Inspired by successful examples like Ethereum, BSC, and Tron, K Chain combines DPoS and PoA to achieve consensus. The adopted solution is as follows:

1. Blocks are generated by a limited number of validators;
2. Validators take turns generating blocks in a PoA manner, similar to Ethereum’s Clique consensus engine;
3. The validator set is selected and eliminated based on staking and on-chain governance.

3.2.2 Number of Validator Nodes

At the genesis block stage of the network launch, a set of trusted nodes will serve as the initial validators. Once block generation starts, anyone can participate as a candidate for the validator role. The top 21 K Chain nodes with the highest staking status will be selected as the next validator set, with the election and rotation process occurring every 24 hours.

3.2.3 Security and Finality

Given that more than half of the validators are honest and trustworthy, PoA-based networks generally operate safely and reliably. However, in some scenarios, Byzantine validators may still attempt to compromise the network, such as through “clone attacks.” To ensure security, we recommend that users wait until the received block has been confirmed by more than two-thirds of the distinct validators.

3.2.4 Rewards

At present, all stakers receive income from block rewards and transaction fees paid in K Coin. These block rewards are akin to mining rewards in the Bitcoin and Ethereum networks. Additionally, K Coin functions as a utility token in other applications, offering further benefits to stakers and delegators who hold K Coin.

3.3 Multi-Chain Parallelism

K Chain utilizes a dual quantum recognition system, K Chain-BlockDAG, for multi-chain parallelism. This system, grounded in solid and reliable laws of physics, resolves consensus mechanism challenges by ensuring that each participant can securely and accurately verify the identity of the other party. Furthermore, since everyone’s “quantum information” is linked to all transactions, the information becomes relatively public and immutable. Based on this, K Chain enables the interconnection and interoperability of information and value across both Blockchain and Non-Block distributed systems. K Chain’s digital assets serve as a medium for cross-platform value exchange, while the K Chain platform itself acts as the carrier for cross-platform information exchange.

Based on the design characteristics of the K Chain system, K Chain has incorporated the ability to read distributed ledger information from Blockchain systems (including UTXO and Account-Based models) and DAG from the initial design stage. In the future, K Chain will enable the direct transmission and reception of public (white) and private (black) tokens between Blockchain and DAG systems. It will also support fully encrypted communication between K Chain clients using zero-knowledge proofs, alongside other exciting features.

Traditional blockchains like BTC and ETH still use binary tree data structures, such as Merkle Trees.

The K Chain technical team is composed of seasoned experts in big data, cloud computing, cryptography, and blockchain. K Chain intends to develop a channel between two entirely different underlying data structure systems, ensuring compatibility with mainstream blockchain technology standards at the foundational level.

K Chain supports the registration and integration of sub-chains, where both the main chain and sub-chains utilize consensus to validate blocks and transactions. K Chain’s digital assets can freely circulate between the main chain and sub-chains.

Multi-Chain Consensus Domain:
The main chain and sub-chain nodes form a multi-chain consensus domain. Within this domain, nodes reach consensus on multi-chain transactions and then share multi-chain data with other peer nodes.

Multi-Chain Consensus Node:
Nodes that join the multi-chain consensus domain need to load additional modules required for multi-chain consensus, such as network modules and multi-chain protocol processor modules.

Security:
The multi-chain consensus domain enforces a minimum node limit for both main chain and sub-chain to prevent centralization. Multi-chain nodes are dynamically adjusted, and no single multi-chain node is allowed to broadcast multi-chain information continuously.

3.4 Distributed Network

K Chain’s payment system adopts the distributed network architecture as shown in the diagram below. This network is built on top of the AKKA concurrency framework based on the Actor model.

Actors interact by sending messages to one another. The threads which are executing the tasks are not passed to the recipient, allowing an Actor entity to continue performing other tasks after sending a message without being blocked. The Actor model enables the completion of more tasks concurrently. Actors handle messages in sequence, processing one message at a time, while the sender and receiver operate independently without interference. This method prevents the disruption of object encapsulation that often occurs with concurrent threads in traditional multi-threaded programming.

Characteristics of the Actor Model:

1. The execution program is decoupled through message passing, maintaining object encapsulation (method calls pass the execution environment, but message passing does not).
2. The internal state of an Actor can only be changed by passing messages, and only one message is processed at a time, eliminating the issue of thread contention in traditional programming.
3. Message senders are not blocked. Millions of Actors can be efficiently arranged across multiple threads, fully utilizing modern CPU potential. Task delegation through messages is the common operational mode of the Actor model.

Network Node
K Chain’s payment system employs a peer-to-peer (P2P) network structure and uses the TCP/IP protocol for communication. The network consists of two types of nodes: regular nodes and book-keeping nodes. Regular nodes can broadcast, receive, and relay transactions, as well as synchronize blocks. Book-keeping nodes, on the other hand, participate in distributed consensus and create blocks. These book-keeping nodes form the core of K Chain, storing complete historical data and monitoring broadcasted transactions. They are globally distributed across numerous nodes equipped with supercomputing power.

Regular users operate light nodes or connect to the network simply as clients. They can access the K Chain network via a light wallet client, block explorer, or mobile app, allowing them to synchronize and store their relevant data, manage their wallets, and carry out digital currency transactions.

Dynamic Sharding
Network transaction throughput can be enhanced through block expansion and horizontal scaling. K Chain’s payment system utilizes intelligent load balancing and autonomous dynamic sharding technology to achieve horizontal scaling of the blockchain. Each shard can process different transactions simultaneously, leading to a significant linear boost in the network’s overall processing performance.

During each cycle, the system randomly groups nodes into a shard, where the nodes within the shard only validate their assigned transactions. They then broadcast the validation results to the main chain, assisting in the finalization of blocks on the main chain.

4.1 Linksay

K Chain’s application scenarios are diverse, and Linksay, as its flagship application, is a revolutionary decentralized messaging tool that takes full advantage of K Chain’s technology. Linksay leverages distributed storage technology to securely store users’ chat logs and personal data on the blockchain instead of on centralized servers. This approach improves data security by reducing the chances of data breaches or misuse and provides enhanced protection for users’ privacy.

On the Linksay platform, users can truly enjoy freedom of speech. Due to its decentralized nature, no single entity can control or censor the communication among users. This means that users can freely express their opinions without the fear of their information being blocked or deleted. Linksay’s openness creates an ideal environment for the exchange of ideas and the sharing of knowledge.

In addition to distributed storage and freedom of speech, Linksay also ensures asset security through K Chain’s blockchain technology. Users can securely conduct cryptocurrency transactions and transfers during chats, with all transaction records being transparent and immutable. This provides users with a reliable payment method as well as a secure platform for commercial transactions.

These features of Linksay demonstrate how K Chain’s innovative blockchain technology is transforming the social communication field. As K Chain’s ecosystem continues to expand and mature, Linksay and other DApps will shine on K Chain, providing users with more diverse and secure application experiences.

4.2 Extended Applications

4.2.1 Cross-Chain Asset Management

With the support of (Decentralized Autonomous Organization) DAO and underlying cross-chain protocols, K Chain can facilitate the interaction and exchange of digital assets across different wallets and blockchains in the future (e.g., K Coin and Ethereum ETH). This will enable cross-chain asset management, fundraising, interest-bearing deposits, digital asset swaps, and other services. These financial services are akin to those provided by traditional banks, enabling both blockchain project owners and users to efficiently and conveniently circulate digital assets on K Chain.

The core function of currency is circulation, and K Chain’s cross-chain asset circulation feature ensures that numerous digital currencies can circulate more freely. This increases the perceived value of digital currencies, allowing ordinary individuals to experience the convenience of blockchain technology.

4.2.2 Cross-Game Community Center

K Chain aims to create a platform that spans across different games, built on social interaction and utilizing blockchain technology to generate valuable virtual assets through fair rules. In the metaverse, players continuously invest time and resources to acquire various valuable virtual items, filling the experience with excitement through exploration and collection. Players project their real emotions into the metaverse, using games as a way to achieve dreams that may not be possible in real life. The metaverse, driven by entertainment, creates and transforms worlds while advancing blockchain technology.

As more games emerge across different metaverses, each game can establish its own dedicated community. K Chain’s goal is to connect these communities, enabling users to freely discuss various game-related topics and share their gameplay experiences and insights. It also creates a space for those investing in gaming assets to engage in discussions about asset trends, market developments, and investment strategies. This will attract an increasing number of participants to the K Chain ecosystem, fostering a positive and thriving community atmosphere.

4.2.3 Decentralized Trading Services

K Chain enables users to trade tokens without relying on a centralized exchange. All transactions on K Chain are processed directly from the user’s wallet. There is no need to trust intermediaries, as tokens do not pass through any third party during the transaction process. K Chain focuses on offering decentralized crypto-to-crypto trading services.

Crypto-to-crypto trading involves the exchange of two different cryptocurrencies, where one currency is used as the pricing unit to purchase the other. When a user initiates a trade request, the system matches the transaction based on priority of price and time. K Chain will support pairings for all major cryptocurrencies.

In the future, K Chain will progressively develop a variety of high-quality cryptocurrency pairings to enhance the exchange’s practicality and liquidity. The trading process on the exchange is illustrated in the diagram below.

• Acceptor posts an order
• User sells/buys
• Acceptor releases
• After the evaluation period, the system conducts a credit rating

4.2.4 DeFi Services

Leveraging its vast user base, K Chain will also offer decentralized financial services (DeFi) to users. Deposit users will contribute digital currencies to the liquidity pool, providing liquidity for the platform. Users can engage with the funds in multiple ways, including deposits, withdrawals, loans, repayments, liquidations, and flash loans. Borrowers can borrow funds based on the available currencies in the reserves, securing a larger value of digital assets as collateral. After repayment, interest income, minus a certain fee, will be distributed to deposit users.

This liquidity pool operates on smart contracts, with no central brokers or large stakeholders involved. The smart contracts ensure the accuracy of the accounts, removing the need for bookkeeping, auditing, counterfeit prevention, and security measures. Authorization, auditing, and account verification functions are built into the smart contracts, significantly reducing operational costs, which can then be passed on to the users as benefits.

• Deposit Users
• Return Principal and Interest
• Deposits Provide Liquidity
• Automatic Clearing
• Collateralized Digital Assets
• Repayment + Interest
• Borrowing
• Borrowing Users
• Smart Contract
• Liquidity Pool

5.1 Native Token

K Coin operates on K Chain in the same way as ETH operates on Ethereum, making it K Chain’s native token. The total supply of K Coin is 21 millions, generated through mining. At the genesis block stage of the network, trusted nodes will be designated as initial validators and will receive a certain amount of K Coin as initial staking rewards. After block generation begins, each block will produce 0.4 K Coin as block rewards, which will be shared among stakers according to predetermined rules. Once 1 million K Coins are mined, the rewards will be halved. K Coin is used to pay transaction fees on K Chain and is also utilized for the following:

• Paying fees for deploying smart contracts on K Chain
• Staking to the elected K Chain validators and various business nodes, earning rewards in return
• Executing cross-chain operations, such as transferring token assets between K Chain and ETH/BNB

Startup Fund
In the startup phase, a portion of K Coin will be designated as the “Startup Fund” and recorded in the accounts of the initial set of validators on K Chain. These K Coins will be utilized to cover transaction fees in the early stages of network operation.

5.2 Other Tokens

As K Chain is compatible with Ethereum, it supports contracts such as KRC-20, KRC-721, and KRC-115. Some KRC-20 tokens can also participate in staking on K Chain, allowing users to earn corresponding K Coin rewards.

POSAP enables decentralized governance within the community, a concept also seen in networks like Cosmos and EOS. The core principles are outlined below:

• Token holders, including validators and various K Chain business nodes, can “lock” their tokens into staking to become stakers. Token holders can delegate their tokens to any staker. Later, they can also reassign their tokens to different stakers.
• All stakers’ validator candidates and business nodes will be ranked based on the number of tokens delegated to them, and the top-ranked candidates will become actual validators.
• Stakers can share block rewards with their delegators.
• Stakers may also incur “penalties” for bad behavior, such as double-signing or instability, and such losses will be shared with their delegators.
• There is a “unbonding period” between stakers and delegators. When malicious behavior or service instability is detected, the tokens remain locked for a certain period, ensuring that malicious or unstable actors are penalized.

6.1 K Chain Staking

Ideally, the staking and reward distribution logic should be embedded within the blockchain and automatically executed when new blocks are generated. Cosmos Hub, which uses Tendermint consensus like K Chain, operates in this way.
From its inception, K Chain required a PoS mechanism and aimed for compatibility with Ethereum. After referencing BSC’s implementation, we adopted the following staking logic on K Chain:

• Staked tokens include K Coin and selected KRC-20 tokens on K Chain.
• Staking and delegation behavior is recorded on K Chain.
• The validator set on K Chain is determined by staking and delegation logic, which is executed daily at UTC 00:00:00 by the staking module.
• Rewards on K Chain are distributed daily at UTC 00:00.

6.2 Continuation of K Chain Staking

Validator set updates and staker reward distributions occur daily at UTC 00:00 to reduce the costs of frequent updates and reward distributions. Frequent reward distributions could result in high costs, as block rewards must be collected on K Chain and then distributed to stakers. To ensure fair distribution, a delayed allocation algorithm is implemented:

• Block rewards are not distributed immediately but are calculated and accumulated in a smart contract;
• When K Chain receives the validator set update, it triggers the transfer of rewards to a custodial address. This address is system-controlled, and rewards cannot be accessed until distribution is finalized;
• To simplify synchronization and prevent forfeiture, rewards for day T are distributed on day T+2.

6.3 Penalties

Penalties are an integral part of on-chain governance, designed to ensure that malicious or harmful behavior is properly punished. On K Chain, anyone can submit penalty evidence. Submissions require both the provision of penalty evidence and payment of a transaction fee, but successful submissions are rewarded.

So far, there are two situations that are subject to penalties:
[Double Signing]
When a validator intentionally signs multiple blocks at the same height with the same parent block, this is considered serious misconduct. The protocol is designed to prevent such behavior, meaning only malicious code could cause it. Upon detection of double signing, the validator should be immediately removed from the validator set.

Anyone can submit a penalty request for double signing on K Chain, which must include two block headers at the same height with the same parent block, along with the signatures of the offending validator. If K Chain verifies the evidence as valid:

• The validator will immediately trigger a “validator set update” message, and the malicious validator will be removed from the set;
• The validator’s staked tokens will be penalized according to a predetermined amount;
• A portion of the penalized K Coin will be rewarded to the evidence submitter, and the reward should far exceed the cost of submitting the penalty request;
• The remaining K Coin will be allocated to the custodial address and distributed to all delegators in the same manner as block rewards.

[Instability]
The overall availability of K Chain and its value-driven social ecosystem applications relies on the staker set within the POSAP consensus. Validators may miss block production opportunities for various reasons, or experience service instability due to node failures, particularly from hardware, software, configuration, or network issues. This instability can degrade network performance, compromise infrastructure stability, and reduce the usability of applications running on the network, introducing further uncertainty into the system.

K Chain has an internal contract responsible for recording missed blocks for each validator and monitoring the service quality of every staker node. If certain metrics exceed predefined thresholds, block rewards will not be allocated to the stakers who triggered these indicators but will instead be distributed among better-performing stakers. This system gradually phases out underperforming validators and nodes, as their delegators will receive fewer or no rewards. If the metrics continue to surpass a higher threshold, the staker will be penalized, and a portion of their staked assets will be forfeited.

[Parameter Management]
K Chain’s behavior is governed by various system parameters, such as penalty thresholds, amounts, and cross-chain transfer fees. These parameters will be decided through a proposing and voting mechanism by K Chain’s stakers.

K Chain aims to transition from technological innovation to global ecosystem development through a series of phased goals, with the objective of becoming a leading decentralized social blockchain platform offering secure, efficient, and transparent digital infrastructure. The roadmap is as follows:

Q3 2024:

• Launch of the K Chain mainnet, completing the network infrastructure setup and security testing.
• Introduction of the POSAP mining mechanism to attract early miners for network maintenance.

Q4 2024:

• Release of K Chain developer documentation and SDK to encourage developers to begin building DApps.

2025:

• Completion of initial cross-chain technology development and integration with at least one major public blockchain.
• Launch of the community governance framework, including the first versions of community forums and voting mechanisms.
• Release of multiple DApps spanning social, content sharing, and micro-payment use cases.
• Expansion of community governance, enhancing community members’ voting rights for network upgrades and proposals.

2026:

• Launch K Chain 2.0, delivering significant improvements in network performance and deploying new features.
• Initiate global promotional campaigns, including multi-language support and localized market strategies.
• Form partnerships with at least five major industry players to expand K Chain’s application scenarios.
• Strengthen compliance measures to ensure adherence to legal and regulatory requirements during global business expansion.

2027:

• Achieve full network scalability, supporting millions of users and high-frequency transactions.
• Promote the international standardization of K Chain technology, enhancing its global influence in the blockchain space.
• Deepen community autonomy, establishing a fully decentralized governance model, including financial and budget management.
• Explore the integration of blockchain technology with other cutting-edge technologies such as AI and IoT.

2028 and Beyond:

• Continue driving innovation to maintain K Chain’s leadership in performance, security, and user experience.
• Expand K Chain’s role in the global social economy, becoming the leading blockchain-based social platform.
• Explore and implement blockchain technology in emerging fields, promoting cross-industry integration and sustained growth.

Through this specific timeline, K Chain will steadily advance its technological development and ecosystem construction, ultimately achieving its vision of becoming a leading global social blockchain platform.

The K Chain development and operations team believes there are numerous risks associated with the development, maintenance, and operation of K Chain, many of which are beyond the team’s control. In addition to the information described in this white paper, each K Chain participant should thoroughly read, understand, and carefully consider the following risks:

Information Disclosure Risk: As of the release date of this white paper, the K Chain platform is still undergoing continuous improvement. Its philosophy, consensus mechanism, algorithms, code, and other technical details and parameters may change and be updated frequently at any time. While this white paper includes the latest critical information about K Chain, it is not entirely comprehensive. The K Chain development and operations team may make further adjustments and updates as needed for specific purposes. The team is neither able nor obligated to inform participants of every technical detail during the development of the K Chain platform, making incomplete information disclosure both inevitable and reasonable.

Market Competition Risk: The public blockchain platform is a highly competitive field, with thousands of teams planning and developing similar projects. The competition will be intense, but in this era, any strong concept, startup, or even established company will inevitably face such competitive risks. However, for us, this competition serves as a driving force in our development process.

Legal and Policy Risk: K Chain may be subject to regulation by various authorities across different countries. Due to the innovative nature of cryptocurrency issuance, there are significant legal gaps in most countries around the world. This industry faces considerable legal and policy uncertainty.

Price Volatility Risk: Cryptocurrencies, when traded on the open market, often experience significant price volatility, with short-term fluctuations occurring frequently. Prices may be denominated in Bitcoin, Ethereum, USD, or other fiat currencies. This volatility can be driven by market forces (such as speculative trading), regulatory policy changes, technological innovations, exchange availability, and other external factors, reflecting shifts in supply and demand balances. The K Chain development and operations team assumes no responsibility for K Coin trading in secondary markets. Traders must bear the risks associated with the price fluctuations of K Coin.